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Accounting for Debt Financing Nicole thinks that her business, Nicoles Getaway Spa (NGS), is doing really well and she is planning a large expansion. With such a large expansion, Nicole will need to finance some of it using debt. She signed a one-year note payable with the bank for $ 50,000 with a 6 percent interest rate. The note was issued October 1, 2014; interest is payable semiannually; and the end of Nicoles accounting period is December 31.
Required:
Prepare the journal entries required from the issuance of the note until its maturity on September 30, 2015, assuming that no entries are made other than at the end of the accounting period, when interest is payable, and when the note reaches its maturity.
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